Economy
US has 501,000 fewer jobs than first reported (Sparky1)
Business services, health care, construction and manufacturing were also lower than first reported. But other sectors had their job totals upwardly revised. Employers in government, financial services, information and transportation and warehousing hired more workers than originally reported.
Indexing Capital Gains Would Be Yet Another Tax Cut for Top 1 Percent (edelinski)
Indexing capital gains for inflation would cost perhaps $100 billion to $200 billion in federal revenues over the first decade, Tax Policy Center (TPC) and Penn Wharton Budget Model estimates suggest. It could also cost state governments billions in lost revenue, as most states base their income taxes on the federal definition of capital gains. This would leave less state revenue to invest in public education, health care, public safety, and human services.
How to become a corporate CEO scam artist in five easy steps (Don R.)
This explosion in CEO pay relative to the pay of average workers isn’t because CEOs have become so much more valuable than before. It’s not due to the so-called “free market.”
It’s due to CEOs gaming the stock market and playing politics.
Trump said “our great American companies” to “immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA.” The losses erased weekly gains for the S&P 500 and the Nasdaq while the Dow was off 0.1%. The Trump statement comes after the Chinese ministry indicated that it was preparing to raise tariffs in two batches on $75 billion in U.S. imports on Sept. 1 and Dec. 15, which would coincide with the dates that the U.S. is slated to increase tariffs on some $300 billion in China goods.
CBO report warns of China trade feud, rising federal deficit (Sparky1)
The analysis also said the federal deficit will rise in the next decade beyond what was initially expected. The budget deficit will run an average of $1.2 trillion from 2020 and 2029 and comprise nearly 5 percent of total GDP — figures “well above” the average over the past 50 years.
Iran moves to strike 4 zeroes from its battered currency (Sparky1)
Also, it was unlikely the parliament would take up Rouhani’s request anytime soon. The request carried a low-urgency level, meaning parliament has up to two years, or until 2021, to deliberate and possibly approve the bill.
However, Iranians are to hold new parliamentary elections in March 2020, making it likely that the bill would be decided on by the next house and Rouhani may not see the new currency before the end of his presidency in 2021.
30-year mortgage rate falls to its lowest level in nearly three years (Thomas R.)
A 3.55% interest rate means someone who wants to spend $2,000 on a monthly payment could afford a $396,000 home, according to Redfin. With a 4% rate the buyer could afford only $379,000. And with a 4.5% rate, could afford only a $363,000 home.
Retailers struggled during boom times. What happens if there’s a recession? (Thomas R.)
Analysts say that the gulf between the sector’s winners and losers is expected to widen in coming months, as illustrated by the latest earnings season. Walmart, Target and Lowe’s all posted better-than-expected profits in the past week, boosting shares of their stock and reassuring investors that U.S. consumers are still opening their wallets. Target’s stock surged 20.4 percent Wednesday to close at an all-time high of $103 after it posted a 17 percent increase in profits and raised its expectations for the rest of the year.
China’s currency is at its lowest level in a decade — and US exporters will pay the price (Thomas R.)
The dollar-pegged currency, also known as the renminbi, trades within a band set by China’s government, and earlier this month the band was moved to fight back against President Donald Trump’s newly announced tariffs. A weaker currency makes Chinese exports comparatively cheaper and more attractive, potentially lifting overseas demand and boosting China’s economy.
Derogatory student loan debt is growing at ‘stunning’ pace, Fed report says (Sparky1)
The New York Fed defines “severely derogatory” as any kind of delinquent loan — along with repossession, foreclosure or charge off — meaning the lender has removed a debt from its books.
The report also found that student loan delinquency rates increased by 10 percent for the period between April and July, transitioning at high levels to relative types of debt.
The Real Reasons Why The Media Is Suddenly Admitting To The Recession Threat (thc0655)
Multiple mainstream outlets ignored all the crash signals in 2005 and 2006 despite ample warnings from alternative economists. In fact, they mostly laughed at the prospect of the biggest bull market in the history of stocks and housing (at that time) actually collapsing. Then abruptly the media and the globalist institutions that dictate how the news is disseminated shifted position and started talking about “recession” and “crash potential”.
China says hopes U.S. stops wrong tariff action, vows to retaliate if new levies imposed (Sparky1)
“Despite the U.S. decision to delay tariffs on some Chinese goods …. if the United States rides roughshod over China’s opposition and impose any new tariffs, China will be forced to adopt retaliatory actions”, Ministry of Commerce spokesman Gao Feng told a news briefing.
Nervous Retirees Are Too Scared to Spend (Adam)
The U.S. economic recovery, the longest in recorded history, has increased Americans’ wealth by $52 trillion, according to the Federal Reserve.
China reveals new counterterrorism unit in Xinjiang (Sparky1)
Peng Jingtang, chief of staff of the Armed Police Force in Xinjiang, said in 2018 the new unit used about the same amount of ammunition as all other Armed Police units in Xinjiang in three years.
Peng also said the amount of ammunition used has been higher in 2019 than for all 12 months of 2018.
Pentagon cancels billion-dollar missile defense project (Sparky1)
The Pentagon currently has 44 missile interceptors based mostly in Alaska. Each is designed to be launched from an underground silo, soar beyond the Earth’s atmosphere and release a “kill vehicle” — a device that steers into its target and destroys it by force of collision.
These weapons have been tested but never used in actual combat.
Banks call for order in Hong Kong as jewelers warn of trade fair dud (Sparky1)
Wednesday’s standoff stopped short of recent intense clashes, including the storming of the legislature and occupation of the airport, with police refraining from using tear gas or attempting to storm protesters’ lines. Police said they arrested two men for unlawful assembly.
Volkswagen not interested in buying Tesla stake (Thomas R.)
A banker close to Volkswagen said that while Diess would love to have Tesla’s software developers, the CEO believed it was almost impossible to justify paying $30 billion (27 billion euros) to buy the whole company.
If “Emissions” Actually Mattered… (thc0655)
Hybrids are falling out of favor because… well, because they’re sensible. That’s not said, of course. The stated complaint is that they still burn gas, damn them. But very little gas. And very little in the way of emissions, too – since the gas engine in a hybrid is generally about 30 percent smaller than in an otherwise similar non-hybrid vehicle and so burns significantly less gas even when it is running.
The Electric Vehicle Revolution Is About To Get Messy (Thomas R.)
The thing that I think we get complacent about is that we inherently assume the battery technology is now settled and static. Of course, if we think about it, we know that’s not true, but we don’t think about it much. Our brains just accept today as reality. Just as the 73 mile LEAF of 2011 wouldn’t last long and range would more than double in 7 years, EV technology of today won’t last long. In 7 years, a LEAF could have much more range or be much cheaper.
The Green New Deal: Less About Climate, More About Control (thc0655)
To assess the economic effects of such a scheme, we started by looking at a carbon tax—the most popular recommendation of those asking government to “nudge” us off of fossil fuels.
Using the Energy Information Administration’s model, we tested to see how high a carbon tax would have to go to meet the Green New Deal’s emission targets. We ratcheted the tax up to $300 per ton, which dropped emissions 58% below 2010 levels—but not until 2050.
UN: Don’t worry about drinking microplastics in water (Sparky1)
“But just because we’re ingesting them doesn’t mean we have a risk to human health,” said Bruce Gordon, WHO’s coordinator of water, sanitation and hygiene. “The main conclusion is, I think, if you are a consumer drinking bottled water or tap water, you shouldn’t necessarily be concerned.”
Amazon tribe looks on helplessly as rainforest is destroyed by man and fire (Adam)
‘For us this is destruction. What is being done here is an atrocity against us.’ The rainforest is home to some one million indigenous people and three million species of plants and animals.
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